Asian Markets Track Global Markets Higher

Asian stock markets are trading mostly higher on Thursday, following the broadly positive cues from global markets overnight, reflecting optimism about an interest rate cut by the US Fed in September after the Fed’s monetary policy announcement where the Fed left interest rates unchanged, as expected, but the accompanying statement hinted at future rate cuts. Asian Markets closed mostly higher on Wednesday.

Fed Chair Jerome Powell said in his post-meeting press conference that a rate cut in September would be “on the table” if economic data continues on its current path. The central bank’s next monetary policy meeting is scheduled for September 17-18, when investors widely expected the Fed to begin lowering interest rates.

According to CME Group’s FedWatch Tool, there is currently a 93.5 percent chance the Fed will lower rates by a quarter point in September.

The Australian stock market is notably higher on Thursday, adding to the sharp gains in the previous session, following the broadly positive cues from global markets overnight. The benchmark S&P/ASX 200 is moving above the 8,100 level to fresh all-time highs, with gains across most sectors led by materials, energy and technology stocks amid spiking commodity prices. Financial stocks were weak.

The benchmark S&P/ASX 200 Index is gaining 34.30 points or 0.42 percent to 8,126.60, after touching a fresh all-time high of 8,148.70 earlier. The broader All Ordinaries Index is up 34.00 points or 0.41 percent to 8,354.40. Australian stocks ended sharply higher on Wednesday.

Among major miners, Rio Tinto, Mineral Resources and Fortescue Metals are gaining more than 1 percent each, while BHP Group is adding almost 1 percent.

Oil stocks are mostly higher. Woodside Energy is gaining more than 1 percent, Origin Energy is edging up 0.2 percent, Beach energy is adding 1.5 percent and Santos is advancing almost 1 percent.

In the tech space, Afterpay owner Block and WiseTech Global are gaining more than 1 percent each, while Xero is adding more than 2 percent, Appen is surging more than 6 percent and Zip is advancing more than 5 percent.

Among the big four banks, Commonwealth Bank, National Australia Bank and Westpac are edging down 0.3 to 0.5 percent each, ANZ Banking Is losing almost 1 percent.

Among gold miners, Evolution Mining, Gold Road Resources and Northern Star Resources are gaining almost 2 percent each, while Newmont is adding more than 2 percent and Resolute Mining is advancing almost 3 percent.

In other news, share on Namoi Cotton are surging almost 6 percent after Australia’s competition watchdog said it will not oppose Louis Dreyfus’ proposed acquisition of Namoi Cotton, despite concerns the deal could lessen competition in the supply of cotton ginning services in the north of Western Australia and the Northern Territory.

Shares in DroneShield are plunging more than 15 percent after the Defence tech dealer wrapped its $120 million capital raise.

Shares in Pacific Smiles are soaring more than 7 percent after it backed a $2.05 per share bid for its business.

In economic news, the manufacturing sector in Australia continued to contract in July, albeit at a slower rate, the latest survey from Judo Bank revealed on Thursday with a manufacturing PMI score of 47.5. That’s up from 47.2 in June, although it remains beneath the boom-or-bust line of 50 that separates expansion from contraction.

In the currency market, the Aussie dollar is trading at $0.653 on Thursday.

Giving up all the gains in the previous three sessions, the Japanese stock market is sharply lower on Thursday, despite the broadly positive cues from global markets overnight. The Nikkei 225 is plunging 2.5 percent to below the 38,100 level, with weakness across all sectors after the Bank of Japan lifted short-term policy rates and announced plans to reduce monthly bond buying in a hawkish pivot.

The country’s central bank hiked its key interest rate to 0.25 percent in a surprise move and laid out a detailed plan to pare monthly bond buying in stages.

The benchmark Nikkei 225 Index closed the morning session at 38,094.24, down 1,007.58 points or 2.58 percent, after hitting a low of 37,737.88 earlier. Japanese shares ended sharply higher on Wednesday.

Market heavyweight SoftBank Group is lunging more than 6 percent and Uniqlo operator Fast Retailing is losing almost 4 percent. Among automakers, Toyota is plunging almost 7 percent and Honda is declining almost 5 percent.

In the tech space, Tokyo Electron is losing almost 2 percent and Screen Holdings slipping more than 8 percent, while Advantest is skyrocketing more than 14 percent after raising its full-year profit outlook on strong chip tester demand.

In the banking sector, Sumitomo Mitsui Financial is losing more than 1 percent, Mitsubishi UFJ Financial is slipping more than 2 percent and Mizuho Financial is declining almost 1 percent.

Among the major exporters, Canon is plunging more than 7 percent, Mitsubishi Electric is plummeting almost 12 percent, Sony is declining almost 4 percent and Panasonic is sliding more than 8 percent.

Among other major losers, Konica Minolta is plummeting almost 15 percent, while Yamaha and Mitsubishi Electric are plunging more than 12 percent. Isetan Mitsukoshi is sliding almost 12 percent, while Sumitomo Realty & Development, Toyota Tsusho and Takashimaya are sliding more than 10 percent each. J. Front Retailing, Mitsubishi Estate, Mitsui Fudosan and Tokyu Fudosan are slipping more than 9 percent each. Alps Alpine, Denso and Subaru are declining almost 9 percent each.

Conversely, Sumitomo Pharma is skyrocketing more than 11 percent, Toto is surging more than 6 percent, Socionext is gaining almost 6 percent and Hitachi is adding more than 4 percent, while Resona Holdings and Nisshin Seifun Group are advancing more than 3 percent each. CyberAgent is up almost 3 percent.

In the currency market, the U.S. dollar is trading in the lower 149 yen-range on Thursday.

Elsewhere in Asia, Taiwan is up 1.2 percent, while New Zealand, China, South Korea and Indonesia are higher by between 0.2 and 0.7 percent each. Singapore and Malaysia are down 0.8 and 0.1 percent, respectively. Hong Kong is relatively flat.

On Wall Street, stocks continued to turn in a strong performance throughout the trading day on Wednesday after moving sharply higher early in the session. The major averages all moved to the upside after ending Tuesday’s trading mixed, with the tech-heavy Nasdaq posting a particularly strong gain.

The Nasdaq soared 451.98 points or 2.6 percent to 17,599.40, more than offsetting the 1.3 percent slump seen during yesterday’s session. The S&P 500 also jumped 85.86 points or 1.6 percent to 5,522.30, while the Dow rose 99.46 points or 0.2 percent to 40,842.79.

The major European markets also moved to the upside on the day. While the U.K.’s FTSE 100 Index jumped by 1.1 percent, the French CAC 40 Index advanced by 0.8 percent and the German DAX Index climbed by 0.5 percent.

Crude oil prices rose sharply Wednesday amid concerns about possible supply disruptions due to rising tensions in the Middle East, and on data showing a larger than expected drop in U.S. crude inventories last week. West Texas Intermediate Crude oil futures for September ended up $3.18 or 4.3 percent at $77.91 a barrel.